CNOOC 0883

[winston]

DJ MARKET TALK: Value In Cnooc Has Emerged After Recent Pullback -MS

1137 [Dow Jones] STOCK CALL: Morgan Stanley tips value has emerged in Cnooc (0883.HK) after the recent pullback, with the stock down 17.4% over the past two months.

"While the stock lacks near term catalysts, medium- to long-term fundamentals remain intact."

Worries over weak oil prices and risks to production volumes are key overhangs for Cnooc's share price for rest of the year, but at current levels, its share price is building in a long-term oil price of US$70/bbl vs the WTI futures curve of US$95/bbl, the house says.

It rates the stock at Overweight and the China oil and gas sector at Attractive. Cnooc is up 2.5% at HK$13.16.

Source: Dow Jones Newswire

[winston]

One incident after another. Is it a company specific risk ?

China's CNOOC cleaning up after another oil spill

Chinese oil giant CNOOC said Sunday it has suspended production at a platform off northeastern China, after a ruptured pipe leaked crude into Bohai Bay, in the lastest spill to hit the company.

CNOOC pledged in August to improve its "management system" to prevent further accidents after more than 3,000 barrels of oil and oil-based mud -- a substance used as a lubricant in drilling -- spilled into Bohai Bay.

CNOOC was accused of covering up that slick, which happened near platforms jointly owned by the Chinese company and US titan ConocoPhillips and polluted an estimated 5,500 square kilometres (2,200 square miles), according to Xinhua.

The State Oceanic Administration -- which supervises and manages China's seas -- has said it plans to sue ConocoPhillips over the spill, which was first detected in early June but only made public nearly a month later.

Source: AFP Asian Edition

http://www.newsmeat.com/news/meat.php?a ... &buid=3281

[winston]

not vested

CNOOC Limited (0883) have fallen from HK$21 to HK$11 and recovered to HK$15 recently.

It now trades at a 10 times historical price-earnings ratio with a 3 percent dividend yield.

It would be a bargain at HK$14, if it drops.

Source: Dr. Check, The Standard HK

[winston]

not vested. And why were these "expert" analysts counting the chickens before they are hatched ?

DJ MARKET TALK: Cnooc Off 2.5%; GS Cuts EPS On PAE Failure

1439 [Dow Jones] Cnooc (0883.HK) is down 2.5% at HK$14.88 vs the HSI's 0.2% decline.

Hurt by news its JV with Bridas Energy, to buy BP's stake in Argentine crude-oil producer Pan American Energy failed, marking yet another setback in China resources firms' quests to grow overseas assets.

"We had expected the acquisition to significantly grow Cnooc's oil and gas asset portfolio in Latin America, given PAE has considerable oil and gas exploration and production activities in the southern cone of South America and is the second-largest oil and natural gas producer in Argentina," says Goldman Sachs;

It adds, Cnooc would now need to drive up its reserve replacement ratio and increase its overseas production.

By cutting estimated PAE production otherwise attributable to Cnooc, GS lowers its FY12 and FY13 EPS forecasts by 2% and 4%, respectively.

Source: Dow Jones Newswire

[winston]

not vested

DJ MARKET TALK: Cnooc Bounces 1.1%; Still 'Growth' Name -Macquarie

1053 [Dow Jones] Cnooc (0883.HK) bounces 1.1% to HK$15.08 after falling 2.2% Monday, which came on its botched $7.1 billion deal with Bridas, to buy BP's majority stake in Pan American Energy.

While lower 2012 production is expected, earnings impact may not be as severe, given unattractive fiscal regime in Argentina which depresses selling prices of crude oil.

Macquarie says 30% of Pan American Energy (net to Cnooc) represents 1.5% of its 2012 EPS estimates and 4% of 2012 production; removing 30% of PAE would leave its forecast of Cnooc's 2012 production growth at about 5%, "still firmly a 'growth' name in the world of large cap oil companies."

The house keeps Cnooc at Outperform with a target price of HK$21.00.

Source: Dow Jones Newswire

[winston]

not vested

Valuation

We give CNOOC a `HOLD` rating with a lowered target price of HK$17.6, which is based on DCF with the assumption of an average realized oil price of US$103/bbl in 2011 and a lowered CAGR of 8.0% in the following 5-years.

We have already lowered CNOOC's production target back in July; yet, the better than expected realized oil prices in 3Q partially offsets the negative effect caused by the lower production volume.

To factor in the expected lower production volume and the slow recovery of demand due to the uncertain economic outlook, we lower our full year eps by 6.7% to RMB1.52/sh.


The stock is currently trading at an attractive valuation. Both p/b and p/e are more than 1std below their respective 5-year means.

While the global economic outlook isn`t clear, we don`t expect the valuation of the stock to recover in the short run.

We expect the earning multiple to recover to 8.5x in the following 12-month period.

Risks:

Key risks include:

1) Given the uncertainty in both China and the global economic outlook and reluctant growth in demand, CNOOC could be hurt more than expected for its cyclical nature;

2) Delays in new projects would also lower the expected growth rate;

3) The incident at PL19-3 hurt investors` confidence and could further increase CNOOC's operational risks;

4) The higher than expected strengthening of RMB could negatively affect earnings;

5) Volatility of oil prices could also negatively affect the Company.

Source: Phillips

[eauyong]

Read from somewhere this Company speculates in financial assets in a big way with borrowed money similiar to Citic Pacific and we know what happened to CP

[winston]

not vested

DJ MARKET TALK: Cnooc Down 1.5%; HK$12.80 As Strong Support - Broker

1032 [Dow Jones] Cnooc (0883.HK) is down 1.5% at HK$13.54, weighed by overall weakness in the broader market.

Any further downside is likely to be limited after its recent sharp falls (down 10.0% month-to-Thursday).

It's valuation being the lowest among the HK-listed oil trio, currently at 7.4X 2011 earnings, based on a Thomson Reuters survey, compared to PetroChina's (0857.HK) 10.1X and Sinopec's 7.7X.

Prudential Brokerage's associate director Alvin Cheung says he expects HK$12.80 as a strong support for Cnooc.

"Still, a relatively weak outlook for oil prices is not a good indicator for Cnooc as an upstream oil play."

Source: Dow Jones Newswire

[winston]

not vested

DJ MARKET TALK: Cnooc Down 2.5%; N/T Support At HK$13.00 - Tanrich

1452 [Dow Jones] Cnooc (0883.HK) is down 2.5% at HK$13.56, weighed by crude price weakness (Nymex January futures settled down 1.9% at US$96.17/bbl Wednesday).

Investors are also digesting news of its latest management change, after Cnooc said Wednesday it appointed executive director Li Fanrong as new chief executive, replacing Yang Hua.

"It's still not that long ago after a similar shuffle happened in April, when the then-Cnooc Chairman Fu Chengyu became chairman of Sinopec (0386.HK), so investors are thinking if there are any further changes in its management ahead," says Tanrich's investment manager Jackson Wong says.

Wong hopes Li could utilize his extensive experience in operations safety management, as trading sentiment for Cnooc has been hurt following the recent oil spills in Bohai Bay and the Gulf of Mexico, as the firm moves into deeper waters for exploring oil and gas.

Its near-term support is tipped at HK$13.00, he adds.

Source: Dow Jones Newswire

[winston]

DJ MARKET TALK: Citi Cuts Cnooc Target To HK$17.00; Keeps At Buy

1158 [Dow Jones] STOCK CALL: Citigroup cuts Cnooc's (0883.HK) target to HK$17.00 from HK$21.40, on a lower target multiple of 8.8X (from 10.9X), the historic average minus one standard deviation, but it keeps the stock at Buy.

Citi expects Cnooc's FY11 volume to come in slightly below management's guidance range but doesn't expect earnings disappointment, as 2H11 earnings should be supported by the strong Duri crude price (the Duri premium over Brent has averaged $8.1/bbl in 2H11).

The house estimates a five-year volume CAGR of 7% through 2015, but growth in the period is very back-end loaded just as FY05-10 growth was.

It adds, Sinopec (0386.HK) remains its top pick in the China oil space. Cnooc is down 0.7% at HK$14.54.

Source: Dow Jones Newswire